London Club

The London club ( or London Club, Club of London, Club de Londres ) is an informal body, the creditor banks and loans in financial difficulties debtor countries with the aim of debt restructuring, debt relief, a moratorium or a change in the credit terms of private loans together leads.

History

He was born in May 1976 in the rescheduling of foreign debt of Zaire. Since August 1982 ( the outbreak of the Mexican crisis ) an interaction with the Paris Club is guaranteed to coordinate national economic and credit creditors. The creditor banks represented in the London club are based on the negotiations of the Paris Club. Therefore, there is a causal chain that begins at the IMF. The IMF must have voted positively to a debtor State before the Paris Club is active financial assistance. If this enter into negotiations with the debtor State, if necessary, also the London club act.

Organization

Just as the Paris Club, the London Club has no written legal foundations, organization constitutions or terms and conditions, and works solely on the basis of incurred in the last decades of tradition and constant exercise. He therefore does not belong to the international non-governmental organizations. Unlike the Paris Club, the London Club has no secretariat and no fixed venue. Initially, most of the negotiations took place in London, which led to its naming.

Composition and working methods

The London club is made up of around 1,000 private creditor banks. He meets most simultaneously with the Paris Club. A commitment by the London club requires at least that a vote in favor of the IMF and / or a commitment of the Paris Club exists. Without these conditions, the London club not active ( conditionality ). When adopting the debt only the actual loan amount is usually adopted, and the accrued interest must continue to be paid back. The negotiations are not subject to fixed rules, a claim the debtor for remission of debt does not exist.